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Some people are just never going to want to learn that much no matter how easy it may be and will need an advisor. To be fair, the drawdown phase is also a fair bit more complicated so for parents seeking advice that are near that time an advisor isn't the worst idea. I also wholeheartedly agree that with family you can provide some advice, but depending on your relationship, you having an active role in their finances may be a bad idea. Happened with my mom when parents got divorced recently, she's never dealt with anything financial, says the stock market is a casino and refuses to have anything to do with it, and suddenly had 7 figures of wealth in semi-complex holdings to figure out. Since this happened not too long before COVID it was good she had an advisor that kept her from selling off everything as the market tanked because she definitely would have otherwise. The website for fee only advisors is napfa.org, but keep in mind that fee-only still includes AUM advisors, so you'd still want to find someone that works on a flat fee or hourly rate schedule.
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Jul 25, 2021 12:50
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Meow Tse-tung posted:Am I right in thinking that 401k contributions reduce taxable income for capital gains purposes? Like if you make 50k a year, and contribute 19.5k, that knocks you below the 40k threshold where you aren't paying tax on gains, as long as they aren't gains that bring your income above the 40k mark? Roth IRA wouldn't work the same way because it's taxed when it goes in? Do I have that all right? Rob Berger is absolutely, positively the #1 financial guru (I hate that term, but it really does apply here) I would recommend to others. He just recently had an episode on the mythical 0% LTCG rate that I think pretty well addresses your question: https://www.youtube.com/watch?v=x2shSiKmYRw vandalism posted:I am at a bit of a crossroads here.
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Jul 25, 2021 18:20
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literally this big posted:Rob Berger is absolutely, positively the #1 financial guru (I hate that term, but it really does apply here) I would recommend to others. He just recently had an episode on the mythical 0% LTCG rate that I think pretty well addresses your question: interesting youtube channel, thanks for sharing someone recently asked about the mechanics of bonds and a recent video on this channel is pretty easy to understand https://www.youtube.com/watch?v=kPTdUZpBlj8
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Jul 25, 2021 20:16
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GhostofJohnMuir posted:interesting youtube channel, thanks for sharing He also has a great podcast called the Dough Rollers Money Podcast. IMO It's the only finance/investing podcast that has years worth of content but it's still worth listening to almost every episode. Every other podcast I tried only had 2-8 truly worthwhile, useful episodes, with the rest covering very basic stuff or the kinds of topics commonly discussed on every other investing podcast. But Rob Berger does a great job at defining terms and explaining conapts when necessary, and then building that into something very practical and useful (like how to maximize your 0% LTCG bracket in the video I posted). I would highly recommend checking out his youtube channel / podcast, more than any other. Plus, the lawyer-analytical way he explains things just clicks perfectly with me.
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Jul 25, 2021 21:15
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Looks like the Podcast hasn't been updated in over a year but I'll give it a listen.
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Jul 25, 2021 21:34
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Crosby B. Alfred posted:Looks like the Podcast hasn't been updated in over a year but I'll give it a listen. I guess he stopped the podcast to start the youtube; probably easier to teach this stuff with visuals.
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Jul 25, 2021 21:53
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So why avoid commission advisors?
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Jul 26, 2021 00:10
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Odd Mutant posted:So why avoid commission advisors? Because it is in their interest to sell you investment products that produce the highest commission for them, not to advise you how to best invest for the goals that you have asked them to advise you on. It's really that simple.
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Jul 26, 2021 00:59
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yeah, i mean famously no one trust car salesman for essentially the same reason.
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Jul 26, 2021 01:10
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You probably won’t go broke or anything with an advisor working for commissions it’s just supremely suboptimal (and they have no real incentive to give a poo poo about you) and sometimes you pay more in fees than annualized returns for the life of the investment depending on a lot of factors. Also, strictly speaking, most similarly styled index funds do the same thing and their ERs are the only real difference. Especially total stock market indexes or ones that track the S&P 500
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Jul 26, 2021 01:13
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Odd Mutant posted:So why avoid commission advisors? Go watch Wolf of Wall Street. That's what a commission based model looks like
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Jul 26, 2021 01:23
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Motronic posted:Gambling rather than investing SHOULD give you a lot of anxiety. There's an easy way to fix this: don't do it. My personal policy is that I'm not comfortable gambling the amount of money that results in a life changing result. I look at odds and I look at returns. Even my savings and brokerage indo "gamblings" are in target date funds where I eyeball the date as a volatility guess index fund comfortably managed by Vanguard and Fidelity.
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Jul 26, 2021 01:47
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literally this big posted:I guess he stopped the podcast to start the youtube; probably easier to teach this stuff with visuals. Ah good call, On the subject of financial media what's on everyone's weekly list? I'm reading the NYT, FT and Bloomberg along with the FTs daily podcast but I'm looking for something that's a bit deeper. Gucci Loafers fucked around with this message at 04:14 on Jul 26, 2021 |
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Jul 26, 2021 03:57
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Crosby B. Alfred posted:Ah good call, I review my investments quarterly, and usually maybe rebalance annually. I don't need podcasts or weekly information to achieve my investment goals. And my life is better for this. I also bet my investment returns are better for this.
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Jul 26, 2021 04:10
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Crosby B. Alfred posted:Ah good call, EarlyRetirementNow blog, White Coat Investor podcast, ChooseFI podcast, Bigger Pockets Money podcast (likely the first one I'll drop), Risk Parity Radio podcast, this thread, check-up call with my CPA in August/September to tax plan. If I stopped all that (I wouldn't give up the CPA call) I don't expect I would have any material loss in expected financial outcomes. The content is not anything new anymore, but it's "surrounding" myself with folks who are being thoughtful around their financial futures, which keeps me on track. Edit: the sources you quoted worry me and I imagine if I looked at them with any regularity I might mistakenly think I could do something insane like time the market. CubicalSucrose fucked around with this message at 04:33 on Jul 26, 2021 |
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Jul 26, 2021 04:30
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CubicalSucrose posted:EarlyRetirementNow blog, White Coat Investor podcast, ChooseFI podcast, Bigger Pockets Money podcast (likely the first one I'll drop), Risk Parity Radio podcast, this thread, check-up call with my CPA in August/September to tax plan. If I stopped all that (I wouldn't give up the CPA call) I don't expect I would have any material loss in expected financial outcomes. Thanks for the recommendations and this is kind of thinking that I am trying to put myself through or get myself in the mindset to think like a financial professional along with understanding the basic nuts and bolts. What's wrong the New York Times or Financial Times?  It's pretty typical newspaper. it's not like I'm reading headlines and immediately messing my investments  but some perspective on what's going in the world if a bit broad is a little useful but I do see that it can become overwhelming as well.
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Jul 26, 2021 04:49
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Crosby B. Alfred posted:Thanks for the recommendations and this is kind of thinking that I am trying to put myself through or get myself in the mindset to think like a financial professional along with understanding the basic nuts and bolts. The best case is what you read in the NYT/FT has no effect on your financial decision-making. The worst case is you get spooked or suckered in to something. If you want to learn about the world then sure, read about the world, but if you want to have money in retirement then I think this thread considers it actively harmful to read financial news. Personally, when I've been more or less forced to see financial headlines regularly for work, I've noticed myself thinking "markets are down this week" or "yeah what about housing's impact on my long-term savings" before I snap out of it because it has no effect on what I'll have 40 years from now. Even if I try to guard against it, it seeps in and I do not believe it helps me make good decisions. And I listen to The Rational Reminder Podcast (if, like me, you're pathologically distrustful of anything calling itself "rational", don't worry it's just a name), follow a couple sporadic (1-3 posts per month) Canadian blogs that would agree with like 95% of this thread, and that's it. I also don't think much would change for me if I stopped following those. When I was first learning, I went through the archives of a bunch of blogs and podcasts, plus threads and books, but now that I'm more sure of my footing it's just a trickle.
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Jul 26, 2021 05:35
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Crosby B. Alfred posted:Thanks for the recommendations and this is kind of thinking that I am trying to put myself through or get myself in the mindset to think like a financial professional along with understanding the basic nuts and bolts.
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Jul 26, 2021 06:46
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The Rational Reminder podcast mentioned above is great. Another one I like is the Long View from Morningstar. It gives a more holistic treatment of retirement planning than just investing and is also more geared towards those in the financial planning industry, but it gives a good look at how advisors are thinking of these things.
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Jul 26, 2021 12:21
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OGDanDogg posted:My personal policy is that I'm not comfortable gambling the amount of money that results in a life changing result. I look at odds and I look at returns. Even my savings and brokerage indo "gamblings" are in target date funds where I eyeball the date as a volatility guess index fund comfortably managed by Vanguard and Fidelity. I have this "issue" as well. I see risky investments (individual stocks, real estate syndication, crypto, etc) as gambling, and I'm not willing to put even 5% of my portfolio in to them. Understandably, this means that I'm not going to see those (potentially) larger returns.
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Jul 26, 2021 12:33
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Crosby B. Alfred posted:Ah good call, My go to recommendation for drat near a decade was Jeff Miller's Weighing the Week Ahead, alas he passed away earlier this year and I have no substitute. I subscribe to Yahoo Finance's Morning Brief with Miles Udland, Economist Espresso, Bloomberg's 5 things to start your day, and Axios Markets by Sam Ro. I also enjoy Odd Lots and Slate Money podcasts. I don't actually do anything based on this media, I just enjoy getting my news though financial type outlets and the podcasts are both a lot of fun.
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Jul 26, 2021 12:44
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paternity suitor posted:My go to recommendation for drat near a decade was Jeff Miller's Weighing the Week Ahead, alas he passed away earlier this year and I have no substitute. Odd Lots can be very entertaining, it's a good podcast. It's also like, 99% irrelevant to long-term retirement investing. It's just a selection of interesting current topics in economics/markets/finance/etc. Here are a couple of great episodes from the last year: discussion of the global shipping disruption and trying to ship a teddy bear on a containership from hong kong to the USA: https://podcasts.apple.com/us/podcast/why-tracy-cant-ship-teddy-bear-from-hong-kong-to-u/id1056200096?i=1000525408004 discussion with the CEO of a major market making firm about payment for order flow and how that all actually works for Robinhood, Schwab, etc: https://podcasts.apple.com/us/podcast/virtu-ceo-doug-cifu-explains-payment-for-order-flow/id1056200096?i=1000514831183
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Jul 26, 2021 13:20
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I like to crowdsource my information on a given topic which is why I only really read the bogleheads forum for investing/ personal finance information. This thread is great but bogleheads gets way more traffic and posts. I feel like that those who write investment/personal finance articles for blogs, newspapers, magazines are ultimately always pushing something which will benefit them or their bosses. My research methodology is to go to google and search via bogleheads (ie. term life insurance site:bogleheads.org). I then read a few of the most recent threads and look for a consensus. I do the same with reddit for personal consumer purchases (ie. backpacking tent site:reddit.com).
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Jul 26, 2021 13:43
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I’m getting into closed end funds because of the relatively lucrative discounts. (14% I believe) The latest one that I just picked up was $JOF. It’s a Japanese small cap fund with a P/e of 14 for its holdings. I think that because it’s a small cap, it will avoid a lot of the issues with the bank of japan and it’s support of large cap equities. I also think that the Japanese yen will appreciate in value compared to the USD.
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Jul 26, 2021 16:17
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Crosby B. Alfred posted:Ah good call, I listen to Marketplace each day. Mostly for the financial stories and not the numbers (just skip that section real quick).
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Jul 26, 2021 18:27
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moana posted:The NYT and FT is just finance pornography. They have a bunch of irrelevant poo poo and incorrect explanations for what's happening. There is almost zero use for "current events" financial reading if you are doing long term investing. It's just white noise wasting your time and mental energy. Now I really get it. Great analogy. Thanks for the replies, I went ahead and put this into one big list. Matt Levine's Money Stuff newsletter is pretty great but while over my head his writing is hilarious. The Rational Reminder Podcast Long View from Morningstar Jeff Miller's Weighing the Week Ahead Yahoo Finance's Morning Brief with Miles Udland Economist Espresso Bloomberg's 5 things to start your day Axios Markets by Sam Ro Odd Lots and Slate Money podcasts bogleheads Marketplace Gucci Loafers fucked around with this message at 02:01 on Jul 27, 2021 |
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Jul 27, 2021 01:58
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jokes posted:You probably won’t go broke or anything with an advisor working for commissions it’s just supremely suboptimal (and they have no real incentive to give a poo poo about you) and sometimes you pay more in fees than annualized returns for the life of the investment depending on a lot of factors. Commissioned financial advisors get sued pretty regularly for both churning (making lots of essentially useless back-and-forth trades to increase commissions) and reverse churning (moving commission-per-trade customers' money into fee-generating managed funds even if they may not get much if any actual 'expert management' out of the deal). There was a case in Canada where a broker did the first so aggressively that he ate a quarter of the entire account in the first four years.Edward Jones got hit with a class-action suit for the latter a few years ago. They don't just have "no real incentive to give a poo poo about you"; even if you get an advisor who understands and respects your wants, risk profile, and timeline, their company's incentive structure often put direct pressure on them to gently caress you over.
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Jul 27, 2021 07:20
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pokeyman posted:And I listen to The Rational Reminder Podcast (if, like me, you're pathologically distrustful of anything calling itself "rational", don't worry it's just a name), follow a couple sporadic (1-3 posts per month) Canadian blogs that would agree with like 95% of this thread, and that's it. I also don't think much would change for me if I stopped following those. When I was first learning, I went through the archives of a bunch of blogs and podcasts, plus threads and books, but now that I'm more sure of my footing it's just a trickle. Dammed monitor always turning itself off. Where’s that button…
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Jul 27, 2021 14:17
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ROJO posted:That doesn't feel like an great sign - still slightly nervous about the money I have parked there. I mean, it’s not really a very tight restriction. Not too hard to find someone to shoot you an invite. But yeah a little concerning I suppose. The account does make me a little nervous and I haven’t been willing to pull the trigger and put as much money over there as I had planned originally. Little things have weirded me out, like they don’t do wire transfers, just ACH withdrawals and deposits through connected banks. I don’t know if it makes sense to be nervous about things like that but there are just quirks that have caused me to delay going all in. hobbez fucked around with this message at 17:41 on Jul 27, 2021 |
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Jul 27, 2021 17:38
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hobbez posted:I mean, it’s not really a very tight restriction. Not too hard to find someone to shoot you an invite. But yeah a little concerning I suppose. The "quirk" is that they're not a bank, but a fintech platform in between you and the actual real bank you're using. This seems like a complication that will make things very difficult should something go wrong. They are FDIC insured, as is the underlying bank so I'm sure anything that happens will get sorted out eventually. But there's likely always going to be a lot of weirdness about what they can or can't do as well as what they will or will not do (i.e. wires, etc). I'll stick to doing business directly with a regulated banks. They're bad enough on their own. I certainly don't need yet another third party involved.
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Jul 27, 2021 18:14
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Years ago I worked for a company very similar to HMBradley that eventually had to shut down when the venture capital ran out. Overall, there is very little difference between fintech startups, because they're all forced into variations of the same business model, with the same levers to push and pull. I'll give a brief overview in case some of you guys aren't aware of this stuff and are curious. Due to federal regulations, they all have to contract with one or more actual banks behind the scenes, who hold customers' money and are FDIC insured. Not many banks were willing to do this back when I was in the industry, but there are more now. They charge the fintech startup a certain dollar amount per active account, and then extra for different services like wire transfers, checkbooks, etc. It's up to the startup whether they want to pass those services (and fees, with some markup) on to their customers. The startup and bank usually also contract with Visa or Mastercard to offer a debit card. From there, the startups all make money from three main sources: balance interest, debit card transactions, and fees. It's very difficult to make enough from these sources to turn a profit. You need your high balance/frequent debit/high fee customers to subsidize your low balance/infrequent debit/low fee customers, plus make up for your extra costs (like, I don't know, giving people 3% interest). My former company's business model did not work out because the interest environment was much worse than anticipated, so balances provided very little revenue. It's substantially worse now. Essentially, right now, everyone earning 3% interest at HMBradley is pulling mostly from their venture capital reserves. Which is fine, no reason not to take the money they're throwing at people. But eventually, it's practically guaranteed that they'll do one or more of these things: lessen rewards and coast with customers too lazy to leave, get bought out by someone (probably a real bank that wants their tech and can keep the business model alive with lower costs and higher margins), or go out of business. So what happens if they go out of business? Usually it's very simple, and does not have anything to do with the FDIC. After all, even if HMBradley goes away, their bank partner(s) will most likely still be just fine. All they have to do is send you a check for the balance when the account is closed. Typically, in an effort to not lose too many accounts at once, they'll offer to convert your account with the failed startup into a normal bank account. They might even offer to convert it to an account with a different partnered fintech startup. Either way, it's a bit of a hassle, but nothing to be terribly concerned about. So yeah, if you can deal with some inconvenience, there's no real harm in taking all the venture capital cash you can.
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Jul 27, 2021 20:57
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runawayturtles posted:Years ago I worked for a company very similar to HMBradley that eventually had to shut down when the venture capital ran out. Overall, there is very little difference between fintech startups, because they're all forced into variations of the same business model, with the same levers to push and pull. I'll give a brief overview in case some of you guys aren't aware of this stuff and are curious. Thanks for this post - I appreciate the insight!
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Jul 28, 2021 02:42
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Update to the "hell, I'll try the Personal Capital $200 offer, let's see what happened" turned into "I have spent 2.5 hours of my free time on calls and it is past the $200 freebie, but let's just throw $2k at them and see what happens" and then "oh you have a $100k minimum, no, gently caress off" I'd be OK seeing wat happened with $4000 and change left over from my final ESPP and pulling out after I get two hundo bucks, but I am not putting actual amounts of money into your robo-advised "we put your money evenly across all 10 major investment sectors" shpiel, especially not when you charge 0.89% of AUM on top of the expense ratios. It would have been beer money. Nice beer, but not enough beer to continue this. runawayturtles posted:HMBradley VC wisdom Born too soon to get VC dollars out of pets.com, born just in time time to get VC dollars out of HMBradley! MJP fucked around with this message at 18:57 on Jul 28, 2021 |
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Jul 28, 2021 18:55
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runawayturtles posted:Years ago I worked for a company very similar to HMBradley that eventually had to shut down when the venture capital ran out. Overall, there is very little difference between fintech startups, because they're all forced into variations of the same business model, with the same levers to push and pull. I'll give a brief overview in case some of you guys aren't aware of this stuff and are curious. Thanks bro, great insight
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Jul 28, 2021 19:03
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Can anyone speak to the tax advantages of syndicated real estate investments? I'm trying to figure out if putting in say, 50k in to a syndicated RE deal has tax advantages in comparison to putting 50k in to "da market." From my understanding, real estate losses/depreciation can only offset other passive income, so it's not possible to reduce W2 income with income from syndicated RE investments (beyond 3k/year). I guess you can carry forward the passive losses down the road, but from what I can tell, this isn't super helpful in the short term, but potentially more helpful down the road as the real estate investment actually ends up generating income.
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Jul 30, 2021 16:24
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Residency Evil posted:Can anyone speak to the tax advantages of syndicated real estate investments? I'm trying to figure out if putting in say, 50k in to a syndicated RE deal has tax advantages in comparison to putting 50k in to "da market." I think the answer is that it depends on the structure of the syndication deal, if it's debt vs equity, how the payouts work, etc. Every so often I think about these things and then realize I don't have the energy to do the required due diligence and even if I did, it's hard to tell that I'd expect to have any sort of higher risk-adjusted return vs VTSAX. The (possible) lack of or anti-correlation with the market is appealing, but the (probable, deal-dependent) illiquidity is not. I can achieve all my financial goals without any real estate investments, and my current Investor Policy Statement has big bold yellowed letters warning against any sort of accredited investing.
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Jul 30, 2021 16:51
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I have 10% of my portfolio in cash, because poverty brain is a real thing. That works out to about 2 years of minimal-living expenses, maybe a tiny bit less. I feel stable in my employment making privileged computer toucher money and am likely to continue as such for the foreseeable future. If I'm going to have that much cash hanging around, it makes sense to put some of it in I bonds, right?
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Jul 30, 2021 17:23
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I've started rolling my lost-my-job 6+ month emergency fund into an I-bond ladder over a 2 year period so I'm not uncomfortably illiquid in the 12 month lockup period. I plan to keep 2-3 months operating expenses in the savings account though for quickest access just in case.
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Jul 30, 2021 18:11
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Yeah if you are going to I-Bond ladder I think it's wise to keep a month or two in HYSA at min. For the poster with 2 years in cash, I think an I-Bond ladder is a good idea. Keep in mind you can only buy like $10K a year through TreasuryDirect and another 5K through your tax return so it might take you a few years to stash the money.
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Jul 30, 2021 18:14
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I also have poverty brain and am keeping a chunk of my abnormally large emergency fund in a TIPS fund. I'm not sure what the difference is between TIPS and I-bonds. I know they both protect against inflation. TIPS I can sell any time in my brokerage account so it seems basically just like inflation-protected cash. I'm not expecting a return on it.
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Jul 30, 2021 19:29
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